We also operate some online storage service, which it's not good for me to disclose the name... We had a profit model a year ago, but now with more companies entering this market, the business model seems not working anymore. Suddenly some companies are offering free services, which attracted a lot of users, e.g. Box.net, but there is no way to recover the cost for me (and for them?). It looks like we are back to the dotcom era, where companies losing more money are considered better and more successful? But how long can these companies last?

DriveHQ does have very competitive products. But can you guys make money on this business? Thanks.

8/23/2006 3:57:12 PM

DriveHQ Webmaster

(1098 posts)

Subject: Re: What's your profit model? -- interesting question

Interesting question. I will wait for the big guys to answer it for you. But I can tell you our business are doing well.

Yes, business is always tough. The advantage of DriveHQ is we have the best products and technologies (which is because we have the best people in this industry). This differentiates us from the low-end free service providers. Ultimately, businesses need to generate positive cash flow; and good customers don't mind to pay for good services.

When a company starts to offer free service, usually it is because it cannot compete in the real market place. They thought by offering free services, it will help them gain competitive advantages. This is very risky and more likely will fail. The reasons? the company will lose revenue stream, and it has to scale down spending. However, the cost will sky-rocketing due to the increased free users. Eventually, the service quality will degrade, and company simply cannot afford to lose money forever.

So DriveHQ's business model is simple. We have always been a technology and service oriented company. We spend little money on marketing. You cannot easily find us on search engine or anywhere. We leverage on our good products and technologies, we rely on our existing user base, we rely on our partners. We are still little known, but we have become one of the largest online storage service providers. The largest digital media software company, Sonic Solutions/ Roxio (NASDAQ: SNIC), is our co-branded partner. We have signed up more and more partners. At the core of our business, we want to create value to consumers and businesses; and we are very willing to work with partners.

If business is tough? yes, sure it is; more than 90% of companies in this sector will be out of business in a couple years. We are confident that we will be the last few companies to survive. If you don't have competitive advantages, then exit this market now might be a wise choice for you. If you have access to big user base or big marketing channel, then work with us, leveraging on what we have. You can make a lot more profit! contact me at bizdev@drivehq.com.

Yes, business is always tough. The advantage of DriveHQ is we have the best products and technologies (which is because we have the best people in this industry). This differentiates us from the low-end free service providers. Ultimately, businesses need to generate positive cash flow; and good customers don't mind to pay for good services.

When a company starts to offer free service, usually it is because it cannot compete in the real market place. They thought by offering free services, it will help them gain competitive advantages. This is very risky and more likely will fail. The reasons? the company will lose revenue stream, and it has to scale down spending. However, the cost will sky-rocketing due to the increased free users. Eventually, the service quality will degrade, and company simply cannot afford to lose money forever.

So DriveHQ's business model is simple. We have always been a technology and service oriented company. We spend little money on marketing. You cannot easily find us on search engine or anywhere. We leverage on our good products and technologies, we rely on our existing user base, we rely on our partners. We are still little known, but we have become one of the largest online storage service providers. The largest digital media software company, Sonic Solutions/ Roxio (NASDAQ: SNIC), is our co-branded partner. We have signed up more and more partners. At the core of our business, we want to create value to consumers and businesses; and we are very willing to work with partners.

If business is tough? yes, sure it is; more than 90% of companies in this sector will be out of business in a couple years. We are confident that we will be the last few companies to survive. If you don't have competitive advantages, then exit this market now might be a wise choice for you. If you have access to big user base or big marketing channel, then work with us, leveraging on what we have. You can make a lot more profit! contact me at bizdev@drivehq.com.

The rumors have been around for sometime that Google will launch GDrive, that's going to be a big thing. Can small player like yours survive it? Why?

Subject: Re: will Google kill your business -- No, Google is only playing catch up

User: jamesjj - 8/29/2006 5:52:35 PM

User: Tough&fun - DriveHQ - 8/24/2006 12:23:26 AM

Yes, business is always tough. The advantage of DriveHQ is we have the best products and technologies (which is because we have the best people in this industry). This differentiates us from the low-end free service providers. Ultimately, businesses need to generate positive cash flow; and good customers don't mind to pay for good services.

When a company starts to offer free service, usually it is because it cannot compete in the real market place. They thought by offering free services, it will help them gain competitive advantages. This is very risky and more likely will fail. The reasons? the company will lose revenue stream, and it has to scale down spending. However, the cost will sky-rocketing due to the increased free users. Eventually, the service quality will degrade, and company simply cannot afford to lose money forever.

So DriveHQ's business model is simple. We have always been a technology and service oriented company. We spend little money on marketing. You cannot easily find us on search engine or anywhere. We leverage on our good products and technologies, we rely on our existing user base, we rely on our partners. We are still little known, but we have become one of the largest online storage service providers. The largest digital media software company, Sonic Solutions/ Roxio (NASDAQ: SNIC), is our co-branded partner. We have signed up more and more partners. At the core of our business, we want to create value to consumers and businesses; and we are very willing to work with partners.

If business is tough? yes, sure it is; more than 90% of companies in this sector will be out of business in a couple years. We are confident that we will be the last few companies to survive. If you don't have competitive advantages, then exit this market now might be a wise choice for you. If you have access to big user base or big marketing channel, then work with us, leveraging on what we have. You can make a lot more profit! contact me at bizdev@drivehq.com.

The rumors have been around for sometime that Google will launch GDrive, that's going to be a big thing. Can small player like yours survive it? Why?

It is interesting a lot of people have asked similar questions. Google would be a formidable competitor should it enter this business very seriously. However, like any other public company, Google has to generate profit. Google is already a $5- billion-revenue company. Online storage business is too small to be significant to Google. Google has a lot of other bigger businesses to do. Google hasn't been successful in Google Finance, Google Talk and Google Spreadsheet, etc. Those are much more important than GDrive.

Secondly, there is no innovation in GDrive. Google is playing technology catch-up in the online storage business. Google has not released anything yet; but companies like us have been in this business for a long time. Virtual Drive, drag-n-drop, local caching, big storage, sharing, everything is already available on DriveHQ, and we also offer free services.

Google will for sure use online advertisement to offset its storage cost. To end users, unfortunately it means a lower quality service with privacy concerns. Also, Google won't offer a good backup tool like DriveHQ WWWBackup, as it won't generate advertisement revenue. For users with very important and / or sensitive data, DriveHQ will always be the best choice.

This being said, Google will put a lot of pressure to those lower-end service providers like Box.net and Streamload. Unfortunately, they will have a very hard time to differentiate themselves from GDrive.

Cloud Storage is the same as Online Storage or Internet Storage. Users can easily upload / download files on DriveHQ cloud storage system using DriveHQ FileManager, web browser, FTP Service or DriveHQ WebDAV cloud drive. Users can remotely access files from anywhere at any time.

DriveHQ Cloud File Server works just like a local file server. You can drag and drop files / folders using FileManager, FTP or WebDAV cloud mapped drive; you can directly edit a remote file and save back; you can manage sub-users and sub-groups; you can share folders to different users with various permissions.

You can get rid of USB backup, DVD backup or tape backup. DriveHQ Cloud Backup is much better and more affordable than traditional backup solutions. You can backup / restore files from anywhere at any time without carrying a backup device. Also because it is offsite backup, it can survive any major disasters.

DriveHQ Online Storage has much more features than other online storage services. It is far more than just online storage,
It supports all modern web browsers and FTP client software;
it has a native client program DriveHQ FileManager and can map a cloud drive. It is seamlessly integrated with DriveHQ Cloud IT system.

You can map DriveHQ online storage as a WebDAV cloud drive, such as Z: drive. No software needs to be installed. It is extremely simple.
If you have a lot of files or very large files, you can also use DriveHQ FileManager or FTP.

DriveHQ online storage service is designed to be extremely secure and reliable. It is managed by professionals,
colocated in a high-end data center with full redundancy and 24x7 onsite security. Your files are secure and private.

DriveHQ Drop Box folder enables anybody to upload files to you securely without having to sign up and without hassle. Just provide your drop box
URL, and anybody can drop files into it. Files in a drop box can only be accessed by yourself.

FTP stands for "File Transfer Protocol". It is the most popular method for transferring files to different locations.
Almost all platforms support FTP. FTP is efficient, reliable and easy-to-use. It can be used to transfer very large files / folders.
DriveHQ offers standard FTP features plus more advanced features at a very low cost.

To setup, configure and secure an FTP server is never easy. FTP server may pose serious security threat as you must open a lot
of network ports; managing FTP accounts and set permission is also a headache. DriveHQ FTP server saves you time and money,
you can set it up in just a few minutes.

DriveHQ FTP Server Hosting service includes FTP server software, hardware and hosting. It is extremely easy to setup. Compared with
other FTP hosting service, DriveHQ FTP service not only is a standard FTP hosting service, but also is seamlessly
integrated with other DriveHQ cloud services.

You can backup files / folders to DriveHQ FTP server from any platforms. Files backed up to DriveHQ FTP server are secure and private.
You can access these files using DriveHQ FTP, DriveHQ.com website or DriveHQ FileManager client software.

You might have a very good backup solution in-house. However, in-house backup is inherently less secure / reliable than offsite backup.
In case of major disasters, such as fire, flood, theft, virus, etc. both the source files and the backup files can be
destroyed as they are in the same location. Offsite backup keeps your backup data in a different location, thus it is far more reliable.

You can backup emails using either DriveHQ Online Backup or DriveHQ EmailManager. Using DriveHQ Online Backup,
you can backup the entire Outlook PST files or other email data folder.
Using DriveHQ EmailManager, it is far more efficient as it can incrementally backup emails and contacts one by one and
it only backs up new emails.

In-house backup such as tape backup is not flexible. You can only backup your data when you are in the same location.
DriveHQ Online Backup is different. You can backup / restore your files & folders from any remote locations.
No backup device or media is required.

You can automatically backup servers and databases in your company; employees can also backup their PCs, laptops and MACs.
Using DriveHQ group account service, you can allocate storage space and download bytes to your sub-users.
All sub-users are treated as premium users. They can access backed-up files online from anywhere.

Email service is very important to any business. There are a lot of free email hosting services; however, for business,
you need something better. You don't have to pay a lot to setup Exchange server or limit yourself to webmail only.
DriveHQ email service is designed for SMBs. It supports SMTP/POP3/IMAP4/webmail and custom domain. You can also create group accounts.

SMTP is the standard protocol for sending emails; POP and IMAP are the standard protocols for retrieving emails.
Most email client software (incl. Microsoft Outlook and Outlook Express) supports SMTP, POP and IMAP. POP3 is usually
used for downloading emails to local; IMAP can keep all emails on server and automatically sync local and remote email boxes.
DriveHQ email server supports all 3 protocols.

DriveHQ email service can be accessed using almost any email client software / device, such as Outlook, Outlook Express, iPhone,
Android, Blackberry and Windows Mobile, etc. Emails can be kept on server so that you can download emails
from multiple computers / devices. Using IMAP, you can also sync your local and remote emails.

You can use DriveHQ Online Backup to backup emails. However, if you use Outlook / Outlook Express, then using DriveHQ EmailManager client
software is much more efficient. You can drag-n-drop upload / download emails and contacts; you can setup automatic backup
tasks to backup your emails and contacts to DriveHQ webmail.

You can create folders in your own account, then share different folders to different users with different permissions.
You can also share folders to sub-groups and contact groups and set different permissions. The same folder can also be shared again
with different permissions. Thus, multiple users can collaborate online.

Using DriveHQ FileManager, you can select a folder and click Synchronize to create a sync-ed folder. You can
sync folders on different computers to the same remote folder, thus you can synchronize multiple computers.
You can also sync folders of multiple users to the same group shared folder, thus you can sync folders of multiple users.

DriveHQ reseller platform makes it extremely easy to launch white label (i.e. private label) or co-branded service.
A co-branded service can be launched in just a few hours. The cost is extremely low at only $50-500/year, which is
about 10 times lower than our competitors'. Resellers can customize or localize the website, service prices and client software.
DriveHQ also has other partnership / affiliate programs suitable for any size businesses.